West gets a taste for Russia’s investment banks
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BANKING

West gets a taste for Russia’s investment banks

If 2006 was the year that western financial institutions began to cherry-pick Russia’s tastiest retail banking operations, 2007 looks set to see them turn their attention to the country’s investment banks.

Domestic players such as VTB want to join in

Although the process of western players acquiring Russian investment banks has already begun – UBS, through its Brunswick acquisition, and Deutsche Bank through its UFG tie-up have been the trailblazers – the pace of activity is certain to pick up.

A done deal?

Ownership of two obvious candidates, Troika Dialog and Aton Capital, might well have changed hands by early 2007. JPMorgan is rumoured to have won the race to acquire a stake in Troika Dialog, the country’s oldest investment bank.

“I heard that it’s a done deal,” said the head of research at a Russian investment bank of the long-mooted tie-up as Euromoney went to press. Citigroup is believed to have been another potential suitor for the firm, with Nomura also mentioned as having shown interest.

If the deal takes place, it will complete a busy period of activity for the Russian player. In August it completed its management buyout with the acquisition of the remaining 5% of its shares from Swiss investment fund Hansa. The process began in 2004 when the buyout of the Bank of Moscow’s stake – previously it was the majority shareholder – was completed.

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